Industry Watch

The JW Marriott hotel, a 342-room full service hotel, opened in November 2015.

Street views: Snow Kreilich Architect image shows the potential for Green 4th Street.

Cities & developers are betting big on innovation districts

Minneapolis, St. Paul and Bloomington are envisioning the future

By Brian Martucci
Thursday, March 24, 2016

The rise of hot neighborhoods like Uptown, Marcy-Holmes and the North Loop prove that affluent professionals actually want to live in post-industrial urban cores. The North Loop’s resurgence is particularly impressive in light of its seedy past as Minneapolis’s low-rent Warehouse District.

But, exciting as they are, these neighborhoods arguably aren’t on the cutting edge of urban development. The real action is found in “innovation districts,” specially designated zones envisioned as live-work-play hubs for creative entrepreneurs and knowledge workers.

Last year, the Minneapolis City Council considered a resolution laying the groundwork for future innovation district designations within the city limits, and neighboring cities are taking action too. Here’s how three innovative Minnesota neighborhoods shape up.   

University Avenue Innovation District, Minneapolis

Just east of the University of Minnesota’s Minneapolis campus, the Prospect Park area is booming. Much of the activity clusters around the Stadium Village and Prospect Park LRT stations, with private developers helping to lead the way. Over the next few years, Minneapolis plans to transform a five-block stretch of 4th Street SE from a densely built residential street into a mixed-use, pedestrian-friendly “green spine” replete with intimate plazas and miniature parks. It’s hoped that “Green Fourth,” as it’s known, will serve as “an organizing place for the district,” says University of Minnesota Foundation Real Estate Advisors managing director Sarah Harris. If the street is successful, future street reconstructions nearby could follow suit. 

Given its proximity to transit and the U, the Prospect Park area is going to develop anyway, says Harris. “The question is, will that development lead a higher level of opportunity? Will it create something that’s important to the city, the county, the region?”

University Avenue Innovation District’s (UAID) partners, including Xcel Energy and the Trust for Public Land, envision cutting-edge “shared systems” in the area: shared parking, storm water management and district energy, all of which would be significantly more efficient than single-parcel systems.

They’re also looking to develop a high-tech research component on more than 350 acres of partially underdeveloped land north of University Avenue. Fully realized, the district could create an additional 10,000 jobs at the university and private firms, thanks to the integrated systems and increased density planned for the area. Private developers are taking advantage of the opportunity and participating in the project; Wall Companies, for instance, has tentative plans to spiff up the historic Harris Machinery Building for future research tenants, pending an assessment after a recent fire in the building. The official name for the innovation district awaits approval.

Creative Enterprise Zone, St. Paul

UAID is likely to benefit from its proximity to St. Paul’s Creative Enterprise Zone (CEZ), a de facto innovation district in the city’s St. Anthony Park neighborhood. Supported by a coalition of artists, entrepreneurs, nonprofits and established businesses, CEZ aims to bridge the gap between St. Anthony Park’s flourishing creative scene and the broader business community — without encouraging wholesale gentrification or development that might threaten the community’s stability.

“CEZ is proof that innovation districts can emerge organically, over many years,” says Creative Community Builders principal Tom Borrup.

As St. Anthony Park’s industrial base was threatened by the construction of the light rail, he explains, local creatives and business leaders fought to preserve the district’s gritty character for a new generation of residents and entrepreneurs. The result: a growing collection of old factories and warehouses supporting hundreds of small-scale “makers,” artists and techie entrepreneurs, plus a handful of larger creative and light industrial firms.

According to Borrup, CEZ is a demonstration project for the next wave of urban renewal, a leading indicator of what’s coming in post-industrial cities across the world. As brilliant researchers and risk-taking entrepreneurs push the bounds of micro-agriculture, 3D printing and other technologies that could revolutionize how we live and work, it’s up to their artsy peers to “figure out how we put aside our differences and adapt to these changes,” Borrup says.

South Loop, Bloomington

Bloomington’s South Loop is a triangle bounded by 494, MN-77/Cedar Avenue, and the Minnesota River National Wildlife Refuge. With the airport just to the north, four Blue Line LRT stations, two major freeways and the money-magnet Mall of America, it’s got an embarrassment of infrastructure riches. But it’s basically a suburban office park with a giant mall in the middle — not exactly the pinnacle of potential.

“The South Loop hasn’t grown as much as you’d think, given its advantages,” says Julie Farnham, Bloomington’s senior city planner. After a failed revitalization effort in the ‘80s and early ‘90s, city leaders got serious about building up the South Loop in the late 2000s. 

Agreed on earlier this decade, Bloomington’s South Loop District Plan focuses on an L-shaped area that follows the Blue Line from I-494 to the MOA. The endgame: transforming the area “from suburban to urban,” creating a new high-density, pedestrian-friendly hub with business, lifestyle and creative amenities to rival downtown Minneapolis. As in the University Avenue Innovation District, shared district systems — notably parking  — would be encouraged.

The Bloomington Port Authority took advantage of the real estate downturn to snap up some low-density warehouses in the area, then sold them to private developers as the market recovered. Hotels and the MOA’s expansion account for the lion’s share of new development in the area, but high-end multi-family housing is in the works too.

Authorities also extended Lindau Lane six blocks, from 24th to 30th Avenues, with an aim to creating a high-density pedestrian spine — and filling in the surrounding parking lots — as the area grows. “We see a domino effect for future development as more projects get built,” says Farnham. “It’s hard to sell a vision on paper.”

That vision will take a while to realize, though, given the area’s size and market uncertainties. According to Farnham, city planners don’t expect the South Loop to be fully developed until 2050.